A new wave of personal ID fraud has led to twice as many bank account
applications by fraudsters who have accessed a catalogue of stolen
information

Bank customers using the same password to sign up to online shopping accounts, phone apps and other web-based services that require their personal details, are unwittingly fuelling a spike in current account fraud, security experts are warning.

A new wave of indentity fraud in which criminals are using highly sophisticated techniques to obtain people's data has led to a doubling in the rate of fraudulent current account applications with this year's rate more than double the previous.

According to credit checking company, Experian, which produced the figures, criminals see current accounts as a lucrative target as they can max out an overdraft as well as using the accounts as a "gateway" to commit other frauds, including making bogus loan and credit card applications.

Behind the figures is a surge in fraudsters attempting to open current accounts by building up a picture of someone else's stolen personal details, including their name, address and birth date.

Customers who have signed up for other services and online accounts with the same security password are making themselves at a heightened risk, according to ACI Worldwide, an electronic payments and fraud company. This is because once criminals have obtained a password for one account, they are able to access multiple accounts and build a detailed profile of someone.

Jackie Barwell, a director at ACI Worldwide, said: "These days most people use dozens of online services - and they want to access them quickly and conveniently. It can be tricky to remember different passwords for each site, and it is really common for people to use the same for each. But where possible people should avoid doing this as they are making life much easier for criminals."

Bank customers are also being warned to be be extra vigilant to spot elaborate "phishing" emails where fraudsters email victims pretending to be from trusted mobile phone providers, energy firms and Government departments, in order to steal people's details.

Another method now being used by fraudsters is "smishing" which has seen thieves drain thousands of pounds from current accounts by intercepting genuine text threads between banks and customers.

Fraudsters, who usually have some of the victim's information already, ask victims to call a number and then extract the remaining details they need to steal their identity.

Data from Cifas, the UK's fraud prevention service, shows the cases of identity fraud rose by 37pc with 129,168 victims over the past 12 months compared to 94,356 during the previous year.

Nick Mothershaw, UK and Ireland director of identity and fraud at Experian, said: "Current account fraud really came to the fore in 2015, with identity thieves acting as the chief culprits. The positive side to this is that these numbers represent detected and prevented fraud attempts, demonstrating the robustness of the protection systems in place for financial products.

Ryan Rubin, a managing director at Protiviti, a security consultancy firm, said: "These days passwords are not good enough to fully protect you from having your details stolen. Major banks are now spending millions of pounds to install preventitive techniques to stop fraudsters - like having new technology to flag these things up on their system."